The Vote Is in and Twitter Gets its Tax Breaks. Now, What about Everyone Else?
We just got word that the San Francisco Board of Supervisors has voted 8-to-3 to approve the Mid-Market incentive plan that would give Twitter– and other companies– a eight year payroll tax deferral for net new jobs if they move their headquarters into the city’s most blighted area. The area in question includes three million square feet of commercial space, most of which has been empty since the 1950s.
No word yet from Twitter on whether this satisfies its issues with the city’s tax laws. It doesn’t come close to solving the broader issues with San Francisco’s payroll tax, but it is certainly a big step in the right direction to keep tech jobs in San Francisco. Said Supervisor Scott Wiener as he voted yes: “We in City Hall do a lot of talking about keeping jobs in San Francisco. Now we have an opportunity to actually take action.”
Expect the pressure to continue on supervisors to solve the problem broadly, which would eliminate the need for these company-by-company negotiations with the city in the future. There are already several other proposals on the table including Supervisor Ross Mirkarimi’s legislation to exempt all San Francisco companies from paying payroll tax on stock options for two years, Supervisor Mark Farrell’s plan for a permanent way to take stock options out of the payroll tax completely, and Supervisor David Chiu’s broader efforts to get rid of the payroll tax entirely. As the San Francisco Planning and Urban Research Association noted today, we may need all of those to solve the broader problem for the next generation of Twitters, Zyngas and Yelps. As Supervisor Farrell said during the vote, “It is no secret that we all seem to realize that our payroll tax system is broken.”
It may take years to get some of these problems solved, and we’ll see if the Board of Supervisors stays as committed without a headline-grabbing impending departure of a big name. Likewise some of the resolve could soften as Supervisors approach 2012 elections– union groups are among many who see this as nothing more than a wasteful corporate giveaway. Either way, we’re going to stay on the story.
- San Francisco Doing Everything It Can To Drive Zynga And Twitter Away
- One Tax Break Later, Twitter Announces Plans To Move To Central Market SF Office
- San Francisco Controller Publishes Candid Report On How Badly They Need Twitter
- The Big Vote Is Today: Will San Francisco Hang on to Twitter?
- City Tax Battle Isn’t About a Two-Year Break. It’s About Repealing the Payroll Tax Completely